U.S. Threatens to Sanction China Over AI Distillation

Ashley Capoot, reporting for CNBC: U.S. Treasury Secretary Scott Bessent on Tuesday said the Trump administration will look into whether Chinese artificial intelligence models have been distilled from American models, stating that the government does not support “IP theft.” Chinese open-weight models are gaining steam against leading offerings from American companies like OpenAI and Anthropic, sparking concerns from tech executives and government officials about the durability of the U.S. lead in the AI race. Moonshot AI, a Chinese startup, released a model called Kimi K3 earlier this month that outperforms those companies across some industry benchmarks. Open weight refers to models whose final trained parameters are publicly released for download, while the underlying code and training data remain private. “If we see, especially that overseas models are stealing from our great companies, we have the ability to sanction them because of this theft,” Bessent told Fox Business’…